Aker Chair Launches Bid For Control Of Company

Norwegian billionaire Kjell Inge Roekke launched a bid last week for full control of industrial holding firm Aker RGI, valuing it at about $1.09 billion. Roekke, who is chairman of Aker RGI and already owns almost two-thirds of the firm after a raid last year, said he wanted to delist Aker RGI from the Oslo bourse if his new bid succeeds. He said he is offering approximately $14 per “A” voting share and $13 per “B” share for Aker, whose interests range from offshore supply company Aker Maritime to an indirect stake in English premier league soccer club Wimbledon. Roekke will buy shares from anyone willing to sell. Under Norwegian law, he can force all minority shareholders to sell to him if he achieves 90 percent control. The offer will run from Aug. 23 to Sept. 3. “We have been in contact with some of the biggest shareholders in the last few minutes and have had positive signals from them,” Roekke said just after his bid was announced. Major shareholders, including insurer Storebrand and industrial group Orkla, declined comment on their plans. Aker RGI chief executive Bjoern Rune Gjelsten, who owns 3.7 percent of Aker, said he believed Aker could benefit from the calm private ownership would bring. He declined to say whether he would sell his own shares. Aker RGI recorded a 42 percent drop in first half operating profits, mainly pressured by weaker results for its offshore supply unit Aker Maritime. The group posted operating profits for the first six months of the year at $36 million down from $61.4 million in the same period a year-ago. Roekke already holds 63.7 percent of the capital in Aker RGI and 61 percent of the voting shares after an offer in July 1998 raised his stake from just over a third. Corrected for dividend payments, the new bid matches the one last year. “This is too low — it’s almost no premium to the recent share price,” one analyst said. At the offer price, Roekke will have to pay about $390 million to secure 100 percent control. Another analyst said Roekke was giving disgruntled shareholders, many of whom have accused him of putting his personal interests ahead of those of Aker RGI, a chance to dump their shares. Roekke’s fully owned The Resource Group (TRG) (Europe) BV, said the new bid was due to “big swings in the price of Aker RGI in the past year and surprisingly weak liquidity, among other things because of the ownership situation.” In 1999 alone, Aker A shares have swung from a low of $10.58 in January to a high of $16.13 in July. TRG said there had been “a lot of negative public debate” about Aker RGI and the role of minority shareholders, adding that it will seek to win control of 100 percent of Aker RGI, delist it from the Oslo bourse to give “freedom for action and more calm for the company.” If successful, Roekke said that he would stick to plans to sell or find a partner for Aker Maritime, which is 63 percent controlled by Aker RGI. “The strategy, as we’ve previously presented it, is unchanged,” he said. Aker RGI also owns firms including seafood company Norway Seafoods and shipyard Aker Yards. Roekke seems flush with cash after Aker RGI sold its stake in Nordic building materials company Scancem in May, giving Aker RGI a profit of $670 million. “It’s obvious that financing is in place,” he said.